Future Homes Commission Report

Baroness Hanham Excerpts

Tuesday 4th December 2012 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Hanham)]

My Lords, I join other noble Lords in thanking the noble Baroness, Lady Whitaker, for drawing this report to the attention of the House. I do not think there is any disagreement among any of us about the importance of it. It is aspirational and practical and draws attention to a lot of the things we all know exist. It also draws attention to things that we all know we would like to see. There is a small problem with finance at the moment but that does not mean to say that we cannot all look forward and take serious steps to deal with it.

I agree with all the points that have been made about making sure that we have adequate and affordable housing and a mixture of tenures. A number of noble Lords have specifically mentioned that any new housing should be of good design and good quality. It is a complete waste of money not to do that. One has to be able to send messages out to developers that it is important that a block of flats is not just thrown up that looks like any other block of flats that is thrown up elsewhere. Therefore, I have no difficulty with any of those points, and I do not think that any other noble Lords have either.

I do not think any of us would disagree with the fact that we are not building enough homes—we are not. We know that. My honourable friend the Minister for Planning made that very clear in an interview the other day. There is government recognition that there has to be a doubling in the number of houses that are built over the next few years. That may be aspirational, but we know that it is required. However, things are moving gently. There is a projected growth of 232,000 households per year until 2033. We know that there were 117,000 completions last year and the expectation is that at least that figure will be met this year and going forward. However, it is clear that that will still not be enough.

The Government also support the necessity to support people’s aspiration to own their own home. A number of noble Lords pointed that out. I think that the noble Lord, Lord Sawyer, pointed out that the security of knowing that they have a home in which they want to live is a real part of people’s lives. Therefore, the quality of homes, both of rented and affordable housing, is very important.

However, the report recognises that not just government action is needed. A response is also needed from the industry: that is, housebuilders, mortgage lenders and landowners. That includes public land. As noble Lords will know, we are beginning to put pressure on departments and local government to release the land they do not need. Assembling land in this way will also be an important aspect of ensuring that there is enough land available on which housing development can take place.

The noble Lord, Lord Best, mentioned four reports that are all pouring out at the same time. I thank him for what he has done and acknowledge that the happy reports on housing for older people to which he referred have raised very important issues, particularly the fact that if older people can get housing which they like and want to move to, which may not be as big as their current family home, they release those homes for families and other people.

The report, as has been said, calls for an increase in the number of new homes built every year to 300,000, which of course is substantially above the current predictions. It also looks for a £10 billion local housing development fund, to be financed by local authority pension funds. Practically all noble Lords who have taken part have referred to the pension funds. There is no disbarment to local government pension funds doing that at the moment. They can already choose to invest in affordable housing projects, although there will be constraints on how much they can put into it—I believe that a figure of 15% was put forward. However, this is not something for which the Government need to legislate or do anything other than encourage—as they are doing—the local authority pension funds to think about making that investment. As everybody has said, it is correct that this money could be used to boost home ownership and development, and once we can get the construction industry moving, that will itself contribute to the economy; it will create new jobs and skills—the noble Lord, Lord McKenzie, referred to apprenticeships—and it begins to open up and unlock all sorts of problems.

The Government are investing a lot of money in housing; the noble Lord, Lord Greaves, perhaps rather unaccommodatingly suggested that there were a plethora of announcements coming out on this. However, to be fair, there is a lot of money and a lot to be said about it. Investing £4.5 billion—a significant sum of money—along with £15 billion from the private sector, will deliver 170,000 new, affordable homes over the period of the spending review. In the September package we provided an extra £300 million to deliver 15,000 additional affordable homes and to bring a further 5,000 empty homes back into use. The Government, therefore, are investing heavily in housing and are encouraging others to do so.

A £10 billion debt guarantee will support more rented housing, including affordable rents. Our reforms to the planning system, which have already been mentioned, will all improve the speed and quality of planning decisions and will bring in local people in order to get their enthusiasm and encouragement for development. So often, as we know, local people are very resentful about any development. Neighbourhood planning should ensure that there is not only a better idea of where housing should go, but there should also be a better idea of quality of housing, what that housing is for, whether or not it is family housing, and where it is placed. Therefore there will not be so much antagonism to development. Part of the Localism Act underscored the point that developers ought to talk to local people about what they want to do in order to try to get that accepted before it goes to a planning committee. We also announced in September that the Government and housebuilders are together investing an additional £900 million in FirstBuy, which will help first-time buyers into home ownership.

These are not trivial sums of money but rather mega-sums, which will generate a renaissance of housebuilding and homebuilding. As noble Lords know, I never like to be unkind, but I point out that the previous Government were not absolutely shining white in terms of the numbers of homes that were delivered. I believe I am correct in saying that the number of homes we are building is well in excess of those built over the last few years of the previous Government. We need to move on all of that.

The Deputy Prime Minister announced last week that the European Investment Bank is going to inject £400 million into affordable housing, particularly to deal with energy-efficient homes—again, a matter that was raised in the report. Another £225 million of government money will leverage private investment to help unlock the large housing sites. The housing development fund is intended to bring together local government pension funds for investment in housing. As I said earlier, that can be done without further legislation.

Any investment decisions made by the Local Government Pension Scheme must be made by its local administering authorities. They must act in a way that protects taxpayers and local services. I know that the Local Government Association is already bringing together people associated with local government pension funds to discuss what can be done.

I am rapidly running out of time. The best that I can do now is to say that I hope that I have given to the House a sense of the fact that we welcome this report as being aspirational and pragmatic. There is plenty in it for everyone to work on. We acknowledge that design and space issues are important, and we clearly acknowledge that we need more affordable housing, and more housing, in this country. The ways of achieving that against the background of a not very secure financial position are important. However, the ideas that are flowing in from all areas are very similar, and on much of this we will be able to harness the future housing of the country.

I thank the noble Baroness again for introducing this debate. I know that we will return over and over again to the matters raised in the report, to which the Government are already directing their attention and addressing in many ways.